THE BOURSE WHISPERER: We received a diversified group of research notes this week looking at companies exploring for commodities ranging through molybdenum, gold, uranium and tungsten.
Dart Mining (ASX:DTM)
Dart Mining has announced highly encouraging drilling results from its 20-hole resource upgrade drilling program at the Unicorn molybdenum-copper-silver porphyry project in Victoria.
The latest drilling results have highlighted the potential to extend the boundaries of the Unicorn deposit to the south and east beyond the current conceptual pit boundary.
The latest drilling returned impressive intersections of up to 30m at 0.18 per cent molybdenum equivalent and significant copper mineralisation (20m at 0.7 per cent copper) was identified in the northern part of the deposit (overall this hole intersected 186m at 0.06 per cent molybdenum equivalent from surface).
We expect there is significant potential to expand the existing resource of 105 million tonnes at 0.07 per cent molybdenum equivalent.
These drilling results have confirmed that the surrounding brecciated material is strongly mineralised (not waste) and can be included in the upgraded resource estimate.
We note that with the inclusion of this material, DTM’s conceptual pit design could have a very low strip ratio to significantly improve the economic viability of the project.
Drilling intersected 252m at 0.06 per cent molybdenum equivalent including 54m at 0.08 per cent molybdenum equivalent within the breccia.
Drilling will likely be completed by July and with one more batch of assay results to be announced in coming weeks, DTM is well placed to announce the resource upgrade for the Unicorn project in August/September.
DTM is targeting initial production of 5 million tonnes per annum (approx. 25-30 thousand tonnes per annum of metal-in-concentrate).
There is strong support for the project by the local community and a ready workforce.
DTM has significant infrastructure advantages and would benefit from significant cost savings during development as the Unicorn project is located 100km from Albury and is supported by power, water, sealed roads and community housing plus existing logistics infrastructure to transport concentrate to smelters in Asia.
The latest drilling at Unicorn has demonstrated the potential for a significant upgrade to the existing JORC resource in Q3, CY12.
DTM will likely outline a Scoping Study for Unicorn in Q4, CY12.
We reiterate our Buy (Speculative) recommendation for DTM with a 12 month target price of $0.18/sh.
Alligator Energy (ASX:AGE)
Alligator Energy is a cashed-up, aggressive uranium exploration company with a large strategic acreage position in one of the world’s best uranium provinces, the Northern Territory’s Alligator Rivers region.
The company’s singular focus is the search and discovery of uranium mineralisation in the region and the reasons are simple: firstly, it’s a proven uranium location, hosting both large and high-grade deposits; and secondly, the Northern Territory welcomes uranium exploration and development.
Alligator’s principal assets areit interests in the Tin Camp project, located within the Alligator Rivers Uranium Province (ARUP) in the northern Territory.
Alligator has secured a prospective land holding in the region and a potential pipeline of quality projects.
In total, Alligator holds 283 square kilometres under three granted tenements and 1,025sqkm under 15 tenement applications.
The Tin Camp project area has been explored intermittently since 1970, resulting in the discovery of the Caramal deposit, the South Horn prospect, the NE Myra prospect, the Two Rocks prospect and the Gorrunghar prospect.
The Caramal deposit and prospect is one of the more significant occurences of uranium mineralisation in the ARUP outside of the Ranger-Jabiluka mining camp.
Given the prospectivity of the Tin Creek project area, it’s no surprise that the company was recently able to announce a maiden JORC-compliant resource estimate for its primary Caramal deposit comprising 944,000 tonnes at 31 per cent uranium for 6.5 million pounds uranium (at a 0.1 per cent uranium cutoff).
Drilling has confirmed high-grade Ranger-style uranium mineralisation, which remains both open along strike and down-dip.
Vital Metals (ASX:VML)
Vital Metals has historically been a tungsten-focused company, with 100 per cent ownership of one of the world’s most advanced, undeveloped tungsten deposits – Watershed in northen Queensland.
The project is now being fully funded through DFS, at a cost of $5.4 million, by Japan’s JOGMEC (Japan Oil, Gas and Metals National Corporation) group.
The Watershed project hosts an undiluted, JORC-compliant Indicated Resource of 15.1 million tonnes grading 0.46 per cent tungsten oxide for 69.3 thousand tonnes of contained metal at a cut-off of 0.1 per cent.
The Resource comprises 997 mineralised intercepts, including 304 intercepts exceeding 5m at 0.5 per cent tungsten oxide, of which 160 exceed 5m at one pe cent tungsten oxide.
The average length of the mineralised intercepts is 5.4m.
The company has actively sought to diversify its exploration focus by farming-into a 450 square kilometre exploration project in southern Burkina Faso, West Africa, where gold is the major target.
Recent drilling has returned the best results yet, including 5m at 60.36g/t gold from 75m, including 2m at 128.5g/t gold from 76m and 15m at 7.75g/t gold from 105m.
The new drilling results are a strong follow up to assay results from previous drilling at Kollo, which have included 18m at 2.95g/t gold from 37m, 31m at 3.19g/t gold from 34m, and 44m at 6.39g/t gold from 8m which included 4m at 58g/t gold from 24m.
The particular importance of these results is that they have extended the limits of known gold mineralisation (still open along strike and at depth) on the Kollo trend.
The team is now working to complete the interpretation of the gold mineralisation with the objective of defining a maiden JORC-compliant resource.